When we're working with buyers and sellers one of the most critical parts of our job is understanding home values. Getting it right for a home seller determines if they sell or don't sell. For a buyer it's the difference between getting a bargain, overpaying, or just paying the going rate for a community.
So what influences a home's value?
We'd love to say it's as simple as plugging in a couple of numbers such as square footage, lot size, age of home, number of bedrooms, baths and garage spaces and out would come a number that would be accurate. But it's not nearly that easy, otherwise the online home value estimates wouldn't need disclaimers of being within +/- 10% or 20%, which when you think about a $300,000 home, that's a range of $270,000-330,000 with the 10% margin of error. That's quite the range isn't it??
But it's not really as simple as a few variables churning out a solid number and then the market adhering to that number. Nope, there are MANY factors that figure into a home's value, and some of it is more art than science and math.
Admittedly a homes size and key features are the major drivers to a home's value. A home that's 1300 square feet is going to need some really special circumstances to outprice a home that's 3900 sq ft. But when you're dealing with homes approximately the same size and features, you can still get some significant variation. Why is this so?
Housing availability at the time. If four similar homes are for sale, there's not a driver to push a home price up. If on the otherhand there's only ONE home for sale, supply and demand kicks in, especially if the home is in a high demand location.
How badly a buyer wants a home. There are times a buyer just has to have a home. Come hell or high water, they're getting THAT home, and if they're a cash buyer normal limits may go POOF.
Environment and home location. A home next to a major road is going to have a different demand than a home backing up to a wooded greenspace in a quiet cul de sac.
Prestige. Some subdivisions have a certain cachet that buyers want. So the smallest home in that community might sell for more than the largest home in another community. It's the "Cheers" effect, some buyers want everyone to know the name of the place they live.
And this is just scratching the surface on factors that can influence a home's price. There are enough variables that an experienced agent is needed to interpret the situation.
Ready to talk Cincinnati real estate? Call Bill of The Liz Spear Team of RE/MAX Elite at 513-520-5305 or email Liz@LizSpear.com.
Serving Cincinnati area home buyers and sellers,
Liz and Bill aka BLiz
Serving Warren County Ohio & Adjacent Areas
The Liz Spear Team of RE/MAX Elite
Elizabeth Spear, ABR, CRS, Ohio License SAL.2002007747
William (Bill) Spear, CRS, Ohio License SAL.2004011109 Kentucky 77938
Ask for us by name if you visit the office!
Two locations: Lebanon & Mason, OH
Bill Direct: 513-520-5305
Liz Direct: 513-265-3004
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